Carvana Investigation Overview
BFA is investigating whether Carvana violated the federal securities laws by making false and misleading statements to investors relating to its accounting for related party transactions as revealed in the Gotham City short seller report. Investors may be able to file a class action to potentially recover losses.
If you lost money on your Carvana investment, you are encouraged to submit your information using the form on this page. You may also email adam@bfalaw.com or call 212.789.3619.
Why Is Carvana being Investigated for Securities Fraud?
Carvana is being investigated for violations of the federal securities laws following a significant stock drop resulting claims of accounting improprieties. The decline in Carvana’s stock price caused significant losses to investors.
Carvana is an online e-commerce platform and used-car retailer that allows customers to buy, sell, or finance vehicles entirely online. A significant portion of Carvana’s revenue comes from its ability to sell vehicles online and originate auto loans, which are subsequently securitized or sold to external parties.
BFA is investigating whether Carvana overstated its earnings and improperly accounted for related party transactions.
Why did Carvana’s Stock Drop?
On January 28, 2026, during market hours, Gotham City Research LLC issued a report titled “Carvana: Bridgecrest and the Undisclosed Transactions and Debts.” The Gotham City report stated that Carvana’s results are deeply intertwined with a network of related party entities controlled by Ernest Garcia II, including DriveTime, Bridgecrest, and GoFi. It further stated that this structure is supported by evidence of loan‑level intermingling and accounting irregularities. The report concludes that these hidden relationships overstated Carvana’s earnings by over $1 billion and poses substantial risks to investors.
On this news, the price of Carvana stock dropped over 20%, from $474.06 per share at open on January 28, 2026 to a low of $374.55 per share.
How Do I Submit My Information?
If you lost money when Carvana securities dropped in price, you are encouraged to submit your information using the form on this page to speak with an attorney about your rights.
You can also contact:
Adam McCall
amccall@bfalaw.com
212.789.3619
All representation is on a contingency fee basis; there is no cost to you. Shareholders are not responsible for any court costs or expenses of any class action lawsuit. The firm will seek court approval for any potential fees and expenses.
Why Bleichmar Fonti & Auld LLP?
BFA is a leading international law firm representing plaintiffs in securities class actions and shareholder litigation. It has been named a top plaintiff law firm by Chambers USA, The Legal 500, and ISS SCAS.
BFA attorneys have been named “Elite Trial Lawyers” by the National Law Journal, among the top “500 Leading Plaintiff Financial Lawyers” by Lawdragon, “Titans of the Plaintiffs’ Bar” by Law360 and “SuperLawyers” by Thomson Reuters.
BFA’s notable successes include a recovery of over $900 million in value from Tesla, Inc.'s Board of Directors, as well as $420 million from Teva Pharmaceutical Ind. Ltd.
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